Is Cryptocurrency Part of the Natural Evolution of Money?

Currency has gone through many changes throughout human history. At first, humans used the barter system. Back then, farmers – as an example – would trade their excess crops for thigs like beer, from the local brewer, or clothing from the local tailor. The earliest traders would often trade a wide variety goods amongst their respective communities. The farmers, brewers, tailors, and anyone else who was providing something valuable to these early communities could simply barter their valuables with one individual, who offered a selection of goods from many parts of the community.

Of course, these early traders needed to carry a large amount of miscellaneous merchandise with them. That is until early traders came up with the idea of creating coins that represented the items they were bartering. Over time, early traders started moving away from these coins which represented the individual goods which they had in stock. They then started producing coins which had a common measurement of value. These coins first appeared as abstract circles, which could be recognized by everyone who used them as a common measurement of value. Therein lies the concept of money, as we see it today.

The First Money

The very first coins, which represented common measurements of value, were made around 600 B.C. They were made in the country of Lydia, which is now known as modern day Turkey. These coins were made of a naturally occurring combination of gold and silver; two metals which still drive the economy to this day.

Paper Money

Paper money was first invented in China, around 700 B.C. This was known as the Tang Dynasty “Flying Money” and was a result of the development of woodblock printing. When Marco Pollo visited China during his ventures around the world, he took the concept of paper money to Europe. At the time, Europe was using a standard international currency, known as the Italian Florin.

Money in the Americas

When the British first colonized what is now the United States of America, the British government made it illegal to produce any native currencies. This is because the British government was afraid of their colonies developing an independent financial system. British colonies in the Americas began using currencies such as the Spanish Dollar, in leu of the currencies used by the British empire. In the 1600’s banks in the Americas began issuing notes which promised to pay the bearer a sum of gold on demand. During the American Civil War, both the northern states and the southern states began printing more paper money than could ever be redeemable in gold. Northern money was printed in green ink, which is why many people associate the color green with money today.

The CHARGET

The world’s first charge card – called the CHARGET – made its debut. Compared to modern day cards, the CHARGET was considerably less advanced. Even so, the CHARGET eventually evolved into the BankAmericard, in 1958. The BankAmericard – which was a product of Bank of America – eventually rebranded as VISA, and the first credit card was born.

ATMs and Electronic Money

In the 1980s, Automatic Teller Machines, or ATMs hit the financial scene, and changed the way we viewed money once again. Aside from credit cards, the world was introduced to Personal Identification Numbers, or PINs and Debit Cards. Services like these allowed individuals to spend and receive money, without exchanging cash, checks, or bank credit. These same technological advancements allowed businesses and individuals to send and receive money electronically, via ACH and Wire transfers.

ACH vs Wire

The Automated Clearing House, or ACH network, includes over 10,000 financial institutions. The ACH network is capable of processing direct debits, direct deposits, direct payments, electronic checks, and electronic funds transfers. ACH transactions fall into two categories: Direct payments (debit transactions) or direct deposit (credit transactions).

Wire transfers are also electronic payments which allow users to send money between accounts, with the option of same-day arrival. This convenience, however, comes at a premium. Wire transfers can be used for both domestic or international transfers. In comparison, ACH transfers are strictly domestic. Wire transfers are more often used to send larger payments between accounts, such as those conducted in real estate purchases.

The Elephant in the Room

Although electronic payment methods are still the most common, cryptocurrency is quickly becoming a viable option, due to its decentralized nature. Because cryptocurrencies – such as Bitcoin – are stored across the entire internet and owned only by those who participate in the cryptocurrency market; banking institutions are unable to control the peer-to-peer transfer of value amongst cryptocurrency’s participants. As cryptocurrency gains traction in the world of finance, it begs the question: Is cryptocurrency the next step in the evolution of money? And if so, what will come next?

Conclusion

The most likely scenario is that cryptocurrencies – such as Bitcoin – will work in tandem with the current electronic financial systems that we have today. It is becoming more obvious every day that cryptocurrency is here to stay. For this reason, there is a large amount of financial gain taking place in the cryptocurrency markets, which is producing advantageous results for a continually growing number of people. Be sure to check out the Killer Whale Products Page to see which Killer Whale products are right for you!

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